Crude Oil Stuck Between EMA Levels as Geopolitical Risk Lingers
Crude oil stuck between 200-day and 50-day EMAs, with $70 support and $85 resistance from Brent, as US-Iran geopolitical risk keeps traders waiting for a catalyst.
Crude oil futures barely moved on Thursday, with WTI trading between its 200-day and 50-day exponential moving averages as traders assessed geopolitical tensions.
The light sweet crude oil market has been stuck within that technical range after breaking above a consolidation zone last week following exchanges of missiles between the US and Iran, according to Chris, a senior analyst at FXEmpire and a proprietary trader with more than 20 years of experience. As long as the Middle East situation does not escalate significantly, the market could settle into a range that is typical for this time of year, Chris said.
The $70 level has held as support so far. Brent crude found itself near the $85 mark, a round psychological figure, also sandwiched between the 200-day and 50-day EMAs. Chris said that pattern could lead to a squeeze. The direction, he added, hinges on the next impulsive candlestick.
The market is waiting for the next headline out of the Middle East, Chris said. The US-Iran standoff appears to be stuck, keeping oil in a range-bound environment. Until a clear catalyst emerges, crude oil is likely to remain between the EMA boundaries, with $70 support and $85 resistance on Brent capping the moves. Chris added that this type of uncertainty is common in oil markets, and patience is required.
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